Tag Archives: budget 2018

On Politics Scotland this week, Christine Jardine shredded the entire budget red book with a few carefully chosen words and some gestures which would make a very fine gif if any of you are so inclined.

Almost a quarter of insolvencies (23%) are caused by late payment issues. That’s a staggering figure that equates to tens of thousands of businesses collapsing every year.

Many other small companies just about manage to absorb late payment, but the loss of income can stop them from investing and growing, it can also damage productivity and generally has a very negative impact. This negative impact isn’t just on the small business, its owners and employees but obviously has a knock-on effect on the wider economy too.

In response to this growing problem, the well intentioned and entirely voluntary Prompt Payment Code was introduced in 2012.

The Code simply requires large companies to pay their suppliers within a maximum of 60 days. Only 2,000 companies have signed it and some of these still pay people beyond 60 days because they know there is very little enforcement and no financial penalty for breaches.

As Liberal Democrat Baroness Burt recently said,

Late payment is a huge threat to British businesses and bitter experience has shown it’s not going to be eradicated by a voluntary Prompt Payment Code especially without any possibility of fines for persistent non-compliance.

The Department for Business, Energy & Industrial Strategy is currently holding a call for evidence on the subject. Association of Accounting Technicians (AAT), which has 140,000 members including thousands of licensed accountants who provide tax and accountancy services to over 400,000 British businesses, has responded by making three key recommendations for change:

that the Prompt Payment Code be made compulsory for companies with more than 250 staff

that payment terms should be halved from a maximum of 60 days to a maximum of 30 days

that a clear, simple financial penalty regime for persistent late payment should be introduced and enforced by the Small Business Commissioner

These recommendations have gained widespread backing from small businesses, business groups and politicians including several senior Liberal Democrats. Lord Fox, the Liberal Democrat Business spokesperson, said

On Monday night, Christine Jardine gave the Lib Dem response to the Budget in the House of Commons. Traditionally the leader does it, but it makes sense to have Vince going round the broadcast media rather than sitting in the chamber for hours on end waiting to be called.

Christine talked about the pain caused by Universal Credit, and mentioned the unfairness suffered by the WASPI women. You can watch her whole speech here and read it below:

Now we have heard it from the Chancellor and the Prime Minister: austerity is over. It is a nice thought, but it will be down to our constituents and those outwith this place to decide whether they have achieved it. Every week, I meet people whose lives have been and are still being damaged by austerity. Today, like us, they have been told exactly what this Government mean when they tell us that it is over. Right now, people up and down the country will be working out the impact of this Budget on their income, their food bills and whether it means that they have reached the light at the end of the dark tunnel that began with the financial crash more than a decade ago in 2008.

I suspect that they will be as disappointed as we are to be promised growth at less than 2% for five years. With Brexit weighing down the economy and the big issues that have not been tackled, today’s Budget does not fulfil even the minimum definition of ending austerity as laid out by the Institute for Fiscal Studies. That would cost £19 billion a year on top of the Government’s NHS commitment. Instead of that, we got more for potholes than for schools, nothing for women born in ​the 1950s and facing pension inequality, and a pathetic, inadequate sticking plaster for universal credit. So much more should, and could, be possible but for Brexit. Just think of the £500 million that the Chancellor added on today to the £3 billion that has previously been allocated for no-deal preparations—what could that have done for our public services?

What we needed today was vision, renewal and a way to reboot not just our beleaguered economy, but our damaged society. Instead, we got that sticking plaster. By March, if some of the Chancellor’s Brexiteer buddies have their way, this plan may have to be torn up and a fresh fag packet found to write a new one on.

Budget Day always generates a lot of press coverage, and this year is no exception, but there have been plenty of other issues worthy of comment. Indeed, there has been so much that I’ve been forced to do this in two parts…

Welsh Lib Dems – Budget a Golden Opportunity

Ahead of the UK Government’s budget, the Welsh Liberal Democrats have urged Chancellor Phillip Hammond to seize the opportunity the budget presents to end austerity and create a fairer, more prosperous Wales.

The Welsh Liberal Democrats are calling on the UK Government to stop Brexit, fix Britain’s broken tax system, fund public services …

It’s something that isn’t really being picked up in the responses I’ve heard so far.

Better off people, higher rate tax payers, are getting a much bigger tax cut than those on low incomes.

That’s right. If you are a basic rate tax payer, your tax threshold rises from £11,850 to £12,500. And while we’re on the subject, this is the annual “Tories take credit for Lib Dem idea” day. Remember how David Cameron told Nick Clegg the idea wasn’t affordable? Every year during the coalition, the Tories used to whinge like anything about having to implement this Lib Dem tax cut for the poorest. Now they just take credit for it like we never happened.

If you are a higher rate taxpayer, you won’t start paying the 40% rate until you are earning £50k, up from £46,350.That is proportionately a significantly higher tax cut than those on low incomes are getting. Sp much for fairness and helping the Just About Managing.

This, of course, is not the case in Scotland where higher rate taxpayers didn’t get last year’s rise and we’ll have to wait and see if Finance Secretary Derek Mackay repeats that this year. The Tories will create merry hell if he doesn’t as they continue with their agenda of grievance. I’d actually rather the SNP sorted public services out, to be honest.

I don’t live in a terribly affluent household, but, even so, a budget that gives us £20 or so extra a month while people are really struggling to find even the most basic housing, or to put food on the table, has got its priorities well and truly wrong.

Senior Lib Dems have attacked the Budget as insufficient to end austerity. In a post on the party website, Vince set out what Lib Dems want to see in a “People’s Budget”:

We would:

Secure the future of our NHS, focusing on social care and mental health with an extra £6bn per year, funded through a penny in the pound on income tax.

Improve living standards for 9.6m parents and children, by reversing George Osborne’s cuts to the “work allowance” under Universal Credit, costing £3bn.

Invest an extra £2.8bn in to the schools budget, by reversing the Government’s proposed cuts to school funding.

Scrap business rates – replacing them with a tax on land values known as the Commercial Landowner Levy. The reformed system would increase incentives to invest in new equipment and renovations, and cut taxes for businesses in nine out of ten English local authorities.

Reverse Conservative cuts to Corporations Tax – still leaving the UK with the lowest rate of corporation tax in the G7.

Work with the EU to crack down on tax avoidance by the tech titans, and working to secure agreement on taxing multi-nationals’ profits.

Reform wealth taxation – bringing capital gains and dividend taxes into line with income taxes, removing the most generous pension tax reliefs from the highest earners, and replacing the inheritance tax system with a fairer lifetime transfer tax.

Vince has been doing the media round, telling LBC:

.@VinceCable tells @LBC The Chancellor is spending billions on preparing fo no deal, that is just money down the drain that should be spent on public services

.@VinceCable: With growth remaining stubbornly low and Brexit weighing down our economy, it is clear the big problems are still to be tackled. It was a sticking plaster Budget when major surgery lies ahead. #Budget2018pic.twitter.com/gdKNvqCYcd